GROWTH LINKAGES AND URBAN-DEVELOPMENT IN NIGER

It is increasingly recognized that the assumption that the supply of t radable output is perfectly elastic, which underlies many regional eco nomic models (esp. economic base models), does not hold in many develo ping countries. When the supply of tradable output (primarily agricult ural products) and, in many cases, non-tradable output is inelastic, t he resulting income multipliers will be substantially reduced. Recent calls for the promotion of market towns and smaller urban centers have not fully considered the impact of supply inelasticities on the capac ity of such measures to stimulate broad-based development. This study uses data collected from firms in several market-town systems in Niger to examine the probable consequences. The paper argues that such poli cies are unlikely to be effective in countries like Niger. where the v ulnerability of the rural economy has severely limited the elasticity of the supply response, especially for agriculture and nonfarm product ion by small-scale producers.